The European Union has taken a landmark step to restrict Chinese medical device manufacturers from participating in public procurement contracts valued over €5 million for the next five years. This unprecedented move follows an extensive EU investigation that uncovered widespread discrimination against European firms in China’s medical device procurement market. The decision marks the first use of the EU’s International Procurement Instrument (IPI), signaling a new era of trade enforcement aimed at ensuring reciprocity and fair competition between the two economic powers.
EU’s Investigation Reveals Extensive Discrimination by China
In April 2024, the European Commission launched its first-ever probe under the International Procurement Instrument, a law enacted in August 2022 to promote fair access to public procurement markets globally. The investigation focused on China’s public tenders for medical devices, a sector identified as a strategic priority under China’s “Made in China 2025” industrial policy.
The EU found that 87% of Chinese public procurement tenders for medical devices contained direct or indirect discrimination against foreign companies, particularly European manufacturers. This included explicit bans on imported medical devices, which rose from 36% of tenders in 2022 to 53% in the first half of 2024. The probe reviewed over 380,000 tenders, with less than 10% offering transparent eligibility criteria, highlighting systemic barriers for EU firms.
China’s “Buy China” policy mandates hospitals to prioritize domestic suppliers, with targets for domestic medical devices to comprise 50% of hospital purchases by 2020, 70% by 2025, and 90% by 2030. This policy is part of a broader strategy to dominate high-tech industries such as robotics, aerospace, and semiconductors.
EU’s Response: A Five-Year Ban on Chinese Bidders
On June 2, 2025, EU member states voted overwhelmingly to impose a ban on Chinese medical device manufacturers from participating in public procurement contracts within the EU exceeding €5 million (approximately US$5.7 million) for five years. This measure is designed to level the playing field and retaliate against China’s discriminatory practices.
The International Procurement Instrument empowers the EU to penalize foreign bidders by lowering their scores or excluding them entirely from tenders. In this case, full exclusion is expected. The move is the first concrete action under the IPI and signals the EU’s readiness to use trade tools aggressively to protect its industries.
Economic and Trade Implications
The EU’s medical technology sector is a significant part of its industrial base, with countries like Germany, France, Belgium, Italy, Ireland, and the Netherlands leading exports. China accounted for 11% of the EU’s medical device export destinations in 2022. Meanwhile, Chinese imports of medical devices into the EU have doubled between 2015 and 2023, reflecting China’s growing role in the global market.
The ban is expected to disrupt supply chains and market access for Chinese firms, while also escalating trade tensions between the EU and China. The decision comes just weeks before a scheduled EU-China summit in Beijing, potentially overshadowing diplomatic efforts with heightened economic friction.
Official Reactions and Future Outlook
EU Trade Commissioner Maroš Šefčovič emphasized the EU’s commitment to open and fair trade but underscored that openness must be reciprocal. He stated the EU is prepared to negotiate with China but warned that decisive measures would be taken if discriminatory practices persist. Šefčovič is set to meet Chinese Commerce Minister Wang Wentao on the sidelines of the OECD Ministerial Council Meeting to discuss these issues.
The European Commission framed the ban as a proportional and necessary response to restore fairness in procurement markets. It also serves as a warning that the EU is willing to escalate trade measures to defend its industries. Industry experts suggest this move could reduce the likelihood of a trade détente at the upcoming summit and may trigger retaliatory actions from Beijing.
China has criticized the EU’s investigation and the resulting measures as unfair trade practices. Chinese officials have expressed hopes for continued cooperation, but the dispute highlights the growing geopolitical and economic rivalry between the two blocs.
The EU’s decision to exclude Chinese medical device manufacturers from large public tenders for five years marks a significant escalation in trade enforcement aimed at combating discriminatory procurement practices. By invoking the International Procurement Instrument for the first time, the EU is signaling its determination to ensure reciprocity and protect its strategic industries. This development is likely to intensify trade tensions with China, impacting global medical device markets and future EU-China relations.
